More jetBlue stuff for Hernan

b737gearboy · 04-11-2002, 11:29 PM

Thursday April 11, 7:19 pm Eastern Time
Reuters Business
JetBlue Airways raises $158 million in IPO

(Adds context and history throughout.)

NEW YORK, April 11 (Reuters) - JetBlue Airways Corp. JBLU.O> said it raised $158.4 million in an initial public offering, with the issue price topping expectations, as the airline's growing profits and low costs attracted strong demand in a time when many airlines are struggling to rebound after Sept. 11.
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The New York-based discount carrier said it sold 5.87 million, or 14.3 percent of its common shares, at $27 each, above the expected range of $25 to $26. The range had already been bumped up from an earlier price range of $22 to $24.

JetBlue is the first of four carriers slated to go public this year, a remarkable trend given the poor track record for upstart airlines and the volatility of fuel prices, rising insurance costs, labor issues and fierce competition on fares.

The last carrier to have an IPO was Midway Airlines Corp. (MDWY.OTC) in 1997, which last year declared bankruptcy. Another, Vanguard Airlines (OTC BB:VNGD.OB - news), was delisted from the Nasdaq last year after profits plunged.

The industry in general suffered $9 billion in losses last year after the Sept. 11 attacks cut into travel volumes. Stiff competition for travelers has driven down profits and hammered aviation stocks, but JetBlue actually turned a profit in the quarter following the attacks.

JetBlue became profitable a year after it began flying in February of 2000. By using only one model of aircraft -- Airbus 320A's -- and flying point to point routes rather than using a hub, the carrier says it has the lowest cost structure in the business.

The company, which now has a market value of $1.11 billion, expects to use the proceeds for operating costs and to fund an expansion that would triple its 24-craft fleet within five years.

The carrier saves on things like training and repair costs by operating just one kind of aircraft. It focuses on underserved markets, tickets online and contracts nonunion labor, a rarity in the industry.

That model has kept operating costs to 7 cents per seat per mile in 2001, almost a third lower than the industry average, according to its prospectus. The percentage of seating capacity filled -- or load factor -- is among the highest in the business, due in part to a reputation for being on time. Travelers don't get meals, but they're compensated with leather seats and satellite images piped into televisions on every seat.

Management also has a strong track record. Chief Executive David Neeleman was a founder of Morris Air, a low-fare airline that was sold to Southwest. Before that he founded WestJet Airlines Ltd. (Toronto:WJA.TO - news), a Calgary-based carrier that's risen 247 percent since going public on the Toronto Stock Exchange in 1999, and 65 percent since Sept. 11.

Still, while JetBlue had profits of $38.5 million on $320.4 million of revenue in 2001, an increase of 200 percent, the carrier has a long way to go to compare with the discount carrier its fashioned itself after, Southwest Airlines Co. (NYSE:LUV - news). Southwest earned $511 million on $5.6 billion in revenues last year.

As it funds an aggressive expansion, JetBlue will have to deal with a rising debt load. Using one measure, its long-term debt is equal to about 50 percent of its overall capital, double the debt ratio of Southwest.

The sale will help set the stage for other airlines expecting to come to market, including Continental Airlines Inc's (NYSE:CAL - news) ExpressJet Holdings, Pinnacle Airlines Corp. and Republic Airways Holdings Inc.

The sale was managed by investment banks Morgan Stanley (NYSE:MWD - news) and Merrill Lynch & Co Inc. (NYSE:MER - news)

hernan · 04-12-2002, 12:04 AM

Zzzzzzzzzzzzzzzzzzzzzz

b737gearboy · 04-12-2002, 10:38 AM

Quote:

Originally posted by hernan
Zzzzzzzzzzzzzzzzzzzzzz

Once again Hernan comes up with one of his thought provoking posts. Exceptional work. Bravo!

Tony Sepanski · 04-12-2002, 12:14 PM

"By using only one model of aircraft -- Airbus 320A's -- and flying point to point routes rather than using a hub, the carrier says it has the lowest cost structure in the business."

Change one word in this statement to 737 and you have a plethora of low-cost airlines: Southwest, RyanAir, EasyJet, Go, etc. I'm not making any statements about the 737 vs. 320, but I was struck by the absolutely unremarkable substance of this statement. They act like JB actually pioneered this concept or something....!

AKJetFan · 04-12-2002, 02:07 PM

I'm kinda new at this stock thing. Do all IPO's trade at $14 higher per share the first trading day? The quote I just saw for JBLU was $40. Anyone know?
Greg

04-12-2002, 02:42 PM

There has been stocks that jumped over 100 dollars in the first day

. I'm not surprised to see where jetblue is and I would suspect it would go even higher.

Jeremy · 04-12-2002, 03:57 PM

Jetblue Schmetblue!
Jetblue is a cool company and I have a friend who is a manager for them in FLL but like Tony said, they act like they are the original.
There is only one original, the most emulated airline in the world-Southwest!
Our local paper said that Jetblue's biggest competitor is Southwest. Hmmmm, let me see, short hall point to point service compared with long hauls from a JFK hub.
Jetblue's competitors are actually AA, DL, and UA.

hernan · 04-12-2002, 09:14 PM

Jet blue is just a Southwest wanna be.

Now let me go back to sleep.wake me up when jet blue......

Zzzzzzzzzzzz.

b737gearboy · 04-13-2002, 12:11 AM

Quote:

Originally posted by hernan
Jet blue is just a Southwest wanna be.

Now let me go back to sleep.wake me up when jet blue...... Zzzzzzzzzzzz.

That attitude has killed many airlines as well as other corporations. You had better hope you management keeps a close eye on jetBlue. You can laugh at them if you want but they might very well give ole SWA a run for their money. As far as being original they are. They are a low fare airline with ASSIGNED seating, sattelite tv, and they are flying out of JFK to boot. They have incredible financing and raised alot of money with their IPO. The airline business is tough and they may go the way of the do-do bird but my money is on Neelman.

hernan · 04-13-2002, 02:39 PM

Let me tell you this. I think jet blue....Zzzzz

zzzzzzz

b737gearboy · 04-13-2002, 09:07 PM

Quote:

Originally posted by hernan
Let me tell you this. I think jet blue....Zzzzz zzzzzzz

Are you even out of high school yet?

hernan · 04-14-2002, 12:54 AM

Zzzzzzzzzzzzzzzzzz

zzzzzzzz

IFTNFS · 04-14-2002, 04:42 AM

...but can they do a 15-minute turnaround?

...but do the FAs sing at the end of the flight?

...and can they maintain a near-perfect safety record for more than 30 years?

There's no question that jetBlue is a good airline and I'm glad to see them going strong, but so long as Southwest maintains that spirit that it has been known for for over 30 years, jetBlue will always be #2 to them, even with personal TVs and a hub at JFK. That's my prediction anyways...

Rick

hernan · 04-14-2002, 10:58 AM

AMEN! I think brother b737 gearboy need some LUV. let give it to him!

04-11-2002, 11:29 PM	#1
b737gearboy Senior Collector Join Date: Nov 2000 Location: KMHT Age: 40 Posts: 248	More jetBlue stuff for Hernan Thursday April 11, 7:19 pm Eastern Time Reuters Business JetBlue Airways raises $158 million in IPO (Adds context and history throughout.) NEW YORK, April 11 (Reuters) - JetBlue Airways Corp. JBLU.O> said it raised $158.4 million in an initial public offering, with the issue price topping expectations, as the airline's growing profits and low costs attracted strong demand in a time when many airlines are struggling to rebound after Sept. 11. ADVERTISEMENT The New York-based discount carrier said it sold 5.87 million, or 14.3 percent of its common shares, at $27 each, above the expected range of $25 to $26. The range had already been bumped up from an earlier price range of $22 to $24. JetBlue is the first of four carriers slated to go public this year, a remarkable trend given the poor track record for upstart airlines and the volatility of fuel prices, rising insurance costs, labor issues and fierce competition on fares. The last carrier to have an IPO was Midway Airlines Corp. (MDWY.OTC) in 1997, which last year declared bankruptcy. Another, Vanguard Airlines (OTC BB:VNGD.OB - news), was delisted from the Nasdaq last year after profits plunged. The industry in general suffered $9 billion in losses last year after the Sept. 11 attacks cut into travel volumes. Stiff competition for travelers has driven down profits and hammered aviation stocks, but JetBlue actually turned a profit in the quarter following the attacks. JetBlue became profitable a year after it began flying in February of 2000. By using only one model of aircraft -- Airbus 320A's -- and flying point to point routes rather than using a hub, the carrier says it has the lowest cost structure in the business. The company, which now has a market value of $1.11 billion, expects to use the proceeds for operating costs and to fund an expansion that would triple its 24-craft fleet within five years. The carrier saves on things like training and repair costs by operating just one kind of aircraft. It focuses on underserved markets, tickets online and contracts nonunion labor, a rarity in the industry. That model has kept operating costs to 7 cents per seat per mile in 2001, almost a third lower than the industry average, according to its prospectus. The percentage of seating capacity filled -- or load factor -- is among the highest in the business, due in part to a reputation for being on time. Travelers don't get meals, but they're compensated with leather seats and satellite images piped into televisions on every seat. Management also has a strong track record. Chief Executive David Neeleman was a founder of Morris Air, a low-fare airline that was sold to Southwest. Before that he founded WestJet Airlines Ltd. (Toronto:WJA.TO - news), a Calgary-based carrier that's risen 247 percent since going public on the Toronto Stock Exchange in 1999, and 65 percent since Sept. 11. Still, while JetBlue had profits of $38.5 million on $320.4 million of revenue in 2001, an increase of 200 percent, the carrier has a long way to go to compare with the discount carrier its fashioned itself after, Southwest Airlines Co. (NYSE:LUV - news). Southwest earned $511 million on $5.6 billion in revenues last year. As it funds an aggressive expansion, JetBlue will have to deal with a rising debt load. Using one measure, its long-term debt is equal to about 50 percent of its overall capital, double the debt ratio of Southwest. The sale will help set the stage for other airlines expecting to come to market, including Continental Airlines Inc's (NYSE:CAL - news) ExpressJet Holdings, Pinnacle Airlines Corp. and Republic Airways Holdings Inc. The sale was managed by investment banks Morgan Stanley (NYSE:MWD - news) and Merrill Lynch & Co Inc. (NYSE:MER - news) __________________ GO BUCKEYES!!!! NATIONAL CHAMPS!! O----H----I----O

04-12-2002, 02:07 PM	#5
AKJetFan Collector Join Date: Jul 2000 Location: Anchorage, AK Age: 36 Posts: 126	I'm kinda new at this stock thing. Do all IPO's trade at $14 higher per share the first trading day? The quote I just saw for JBLU was $40. Anyone know? Greg __________________ Somebody PLEASE make an Alaska Airlines Convair 990!

04-12-2002, 03:57 PM	#7
Jeremy Master Collector Join Date: Sep 2000 Location: BAA Indianapolis Posts: 583	Jetblue Schmetblue! Jetblue is a cool company and I have a friend who is a manager for them in FLL but like Tony said, they act like they are the original. There is only one original, the most emulated airline in the world-Southwest! Our local paper said that Jetblue's biggest competitor is Southwest. Hmmmm, let me see, short hall point to point service compared with long hauls from a JFK hub. Jetblue's competitors are actually AA, DL, and UA. __________________ One Nation under God There will be weeping and gnashing of teeth

04-12-2002, 09:14 PM	#8
hernan Senior Collector Join Date: Mar 2001 Location: CAROLINA,PUERTO RICO Age: 42 Posts: 426	Jet blue is just a Southwest wanna be. Now let me go back to sleep.wake me up when jet blue...... Zzzzzzzzzzzz. __________________ FLY SOUTHWEST. THE ONLY WAY TO FLY ! COLLECT STAR JETS. THE BEST MODELS!

04-13-2002, 02:39 PM	#10
hernan Senior Collector Join Date: Mar 2001 Location: CAROLINA,PUERTO RICO Age: 42 Posts: 426	Let me tell you this. I think jet blue....Zzzzz zzzzzzz __________________ FLY SOUTHWEST. THE ONLY WAY TO FLY ! COLLECT STAR JETS. THE BEST MODELS!

04-12-2002, 12:04 AM	#2
hernan Senior Collector Join Date: Mar 2001 Location: CAROLINA,PUERTO RICO Age: 42 Posts: 426	Zzzzzzzzzzzzzzzzzzzzzz __________________ FLY SOUTHWEST. THE ONLY WAY TO FLY ! COLLECT STAR JETS. THE BEST MODELS!

04-12-2002, 12:14 PM	#4
Tony Sepanski Master Collector Join Date: May 2000 Location: Seattle, WA, USA Posts: 798	"By using only one model of aircraft -- Airbus 320A's -- and flying point to point routes rather than using a hub, the carrier says it has the lowest cost structure in the business." Change one word in this statement to 737 and you have a plethora of low-cost airlines: Southwest, RyanAir, EasyJet, Go, etc. I'm not making any statements about the 737 vs. 320, but I was struck by the absolutely unremarkable substance of this statement. They act like JB actually pioneered this concept or something....!

04-12-2002, 02:42 PM	#6
JohnnyB Guest Posts: n/a	There has been stocks that jumped over 100 dollars in the first day . I'm not surprised to see where jetblue is and I would suspect it would go even higher.

04-14-2002, 12:54 AM	#12
hernan Senior Collector Join Date: Mar 2001 Location: CAROLINA,PUERTO RICO Age: 42 Posts: 426	Zzzzzzzzzzzzzzzzzz zzzzzzzz __________________ FLY SOUTHWEST. THE ONLY WAY TO FLY ! COLLECT STAR JETS. THE BEST MODELS!

04-14-2002, 04:42 AM	#13
IFTNFS Senior Collector Join Date: Jul 2000 Location: Harwich, MA, USA Age: 27 Posts: 427	...but can they do a 15-minute turnaround? ...but do the FAs sing at the end of the flight? ...and can they maintain a near-perfect safety record for more than 30 years? There's no question that jetBlue is a good airline and I'm glad to see them going strong, but so long as Southwest maintains that spirit that it has been known for for over 30 years, jetBlue will always be #2 to them, even with personal TVs and a hub at JFK. That's my prediction anyways... Rick

04-14-2002, 10:58 AM	#14
hernan Senior Collector Join Date: Mar 2001 Location: CAROLINA,PUERTO RICO Age: 42 Posts: 426	AMEN! I think brother b737 gearboy need some LUV. let give it to him! __________________ FLY SOUTHWEST. THE ONLY WAY TO FLY ! COLLECT STAR JETS. THE BEST MODELS!

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